Monday, January 26, 2015

The Queen of Versailles

If you have not watched "The Queen of Versailles", you may want to give it a try.

The documentary tracks the lives of David Siegel (the founder & CEO of Westgate Resorts) and his wife, Jackie.

It started with David Siegel's plan to build the Versailles House (a multimillion dollar mansion castle that would have been the largest house in the United States) and the Ph Towers Westgate in Vegas.

This was all before the 2008 financial crisis, so everything was looking bullish for the family. David's trophy wife, Jackie, happens to be the typical homemaker who lives an extravagant life, collecting antiques, travelling the world and spending money faster than it can fall from the sky.

All that changed during the subprime crisis and it was captured in the documentary (this is where it gets interesting). Due to the highly leveraged nature of the Ph Towers Westgate in Vegas, David Siegel found himself struggling to complete the project during the financial crisis.

At the very same time, his dream to complete the 90,000 square foot mansion, The Versailles House was threatened. The family then had to make ends meet by watching their spending closely, conforming to a less-extravagant life.

The point that was conveyed through the documentary is simple and it runs along this:

When you're earning $50,000 a year, don't spend as if you're earning $100,000 a year. Likewise, if you're earning $1,000,000 a year, don't spend as if you're earning $1,000,000,000 a year.

It's not rocket science but most of us fall prey to this phenomenon.

There was another moment in the documentary which I thought was extremely amusing. When Jackie (David Siegel's trophy wife) was working in IBM as a computer engineer many years ago, she asked her manager why he had a clock counting down.

Her manager said that the clock was there to show him the days, hours, minutes and seconds until he could retire - because that is when he can start living life.

As a result of that conversation, Jackie quit her job at IBM, pursued her modelling career and married David Siegel.